Company Administrations Fall For Fifth Sucessive Period
The number of troubled companies falling into insolvency has
dropped by less than one per cent (0.8%) with 777 companies being
placed into administration in England and Wales in Q2 2010,
according to statistics released today by the Government's
Insolvency Service. This is 24.3% drop year-on-year, compared to
the 1,027 administrations recorded in Q2 2009.
"Administrations have now fallen for five quarters in a row
since they peaked in Q1 2009, which saw 1,311 companies fall into
administration. This is a welcome trend in the number of business
failures, but the UK economy is not out of the woods yet. The
recent lacklustre performance of the important services sector is a
real cause of concern, coming before the full impact of the
reductions in government spending and the impending VAT rise. We
expect to see an increase in business failures in outsourcing, as
well as the hotel and leisure services sectors," commented Malcolm
Shierson, Partner at Grant Thornton's Recovery and
Reorganisation practice.
"There is widespread concern that the recovery of the UK economy
will suffer some set-backs, which is why the Bank of England kept
interest rates on hold at 0.5%. The purchasing managers' index
indicates that full year growth may well fall short of the 1.1%
rise in GDP reported in the second quarter of 2010.
" Company liquidations in England and Wales also dropped to
4,080 in Q2 2010. This figure reflects a fall of 0.5% on the
previous quarter (4,060 in Q1 2010) and a fall of 19.1% against the
same period in the previous year (5,041 in Q2 2009).
"The health of the UK economy is mainly reflected in the number
of administrations. Typically large employers are placed in
administration when they run into trouble, whereas liquidations are
more common among smaller enterprises," concluded Grant Thornton's
Malcolm Shierson.
Ends
Please note that these figures are available at:
http://www.insolvency.gov.uk/otherinformation/statistics/insolv.htm
For more information please contact: Alex Wessendorff, Grant
Thornton Press Office, T +44 (0)20 7728 2048, M +44 (0) 7792 924
229, E Alex.Wessendorff@gtuk.com